News

America’s Roundup: Dollar dips as U.S. stimulus optimism boosts risk taking, Wall Street retreats, Gold gains, Oil rises on hopes U.S. pandemic stimulus will spur fuel demand-December 30th,2020

Market Roundup

• All three major U.S. stock indexes down

• Crude prices rise on hopes for demand rebound

• US Redbook (MoM) 0.4%,-0.9% previous

• US Redbook (YoY) 8.9%, 6.5% previous

• US Oct S&P/CS HPI Composite – 20 s.a. (MoM) 1.6%,1.0%,1.3% previous

•US S&P/CS HPI Composite – 20 n.s.a. (MoM) 1.3%, 1.2% previous

•US Oct S&P/CS HPI Composite – 20 n.s.a. (YoY) 7.9%, 6.9% forecast, 6.6% previous

• US Dec Dallas Fed Services Revenues 4.2, -0.7 previous

• US Dec Texas Services Sector Outlook -4.3 -2.6 previous

Looking Ahead – Economic data (GMT)

•No data ahead

Looking Ahead – Economic events and other releases (GMT)

•No events ahead

Fxbeat

EUR/USD: The euro rose against dollar on Tuesday as investors were encouraged to take on more risk after U.S. lawmakers pushed forward with an enhanced COVID-19 relief package. The House of Representatives voted on Monday to more than triple stimulus payments to Americans to $2,000 from $600, sending the plan on to the Senate for a vote. Euro bulls pushed the single currency up to $1.2235, also buoyed by talk of a EU-China trade pact. Immediate resistance can be seen at 1.2277 (23.6%fib), an upside break can trigger rise towards 1.2300(Psychological level).On the downside, immediate support is seen at 1.2168 (14DMA), a break below could take the pair towards 1.2138 (38.2%fib).

GBP/USD: Sterling strengthened against dollar on Tuesday as investor were encouraged by a Brexit trade deal and hopes a long-awaited U.S. pandemic relief package will be expanded. Britain clinched a narrow Brexit trade deal with the EU on Thursday, just seven days before it exits one of the world’s biggest trading blocs. Sterling rose 0.2% to $1.3484 following a two-day dip. It was as high as $1.3625 this month, a level unseen since May 2018, but investors have taken some profits since the Brexit trade deal was struck. Immediate resistance can be seen at 1.3524 (38.2%fib), an upside break can trigger rise towards 1.3617 (23.6%fib).On the downside, immediate support is seen at 1.3449 (50%fib), a break below could take the pair towards 1.3412 (21DMA).

USD/CAD: Canadian dollar was little changed against its U.S. counterpart on Tuesday as investors looked to Washington for signs that an enhanced stimulus package would pass a Senate vote, while crude oil gained ground. Trading is thin with many investors out between the Christmas and New Year holidays. The Canadian dollar was last up 0.01 percent at 1.2816 to the greenback. Immediate resistance can be seen at 1.2854 (38.2%fib) upside break can trigger rise towards 1.2900 (50%fib ).On the downside, immediate support is seen at 1.2811 (21 DMA), a break below could take the pair towards 1.2788(23.6%fib).

USD/JPY: The dollar dipped against the Japanese yen on Tuesday as the prospect of additional U.S. stimulus weighed on the dollar. The U.S. House of Representatives voted on Monday to meet President Donald Trump’s demand for $2,000 direct payments to Americans as part of the recently signed fiscal relief bill, sending the measure to the Republican-controlled Senate. Senate Majority Leader Mitch McConnell blocked an effort to approve the direct payments by unanimous consent, but said the chamber would address the increased stimulus checks this week. Strong resistance can be seen at 103.81 (38.2%fib), an upside break can trigger rise towards 103.91 (30DMA).On the downside, immediate support is seen at 103.66 (5EMA), a break below could take the pair towards 103.38 (23.6%fib).

Equities Recap

European stocks extended their year-end rally on Tuesday as a Brexit trade deal, hopes of an expanded U.S. stimulus package and euro zone’s marathon COVID-19 vaccination campaign brightened prospects for global growth in 2021.

UK’s benchmark FTSE 100 closed up by 1.55 percent, Germany’s Dax ended down by 0.21 percent, France’s CAC finished the day up by 0.42 percent.

The S&P 500 dipped in choppy trading on Tuesday as the top U.S. infectious disease expert warned Congress that a premature opening of the nation’s economy could lead to additional outbreaks of the novel coronavirus.

Dow Jones closed down by 0.22% percent, S&P 500 closed down by 0.22% percent, Nasdaq settled down by 0.38% percent.

Treasuries Recap

U.S. Treasury yields were flat to modestly higher on Tuesday in thin trading as U.S. stocks surrendered gains, with investors betting a heftier federal stimulus check was unlikely to get the nod in the Republican-led U.S. Senate.U.S. 30-year yields rose to 1.673% from Monday’s 1.669%.

Commodities Recap

Gold prices rose on Tuesday as the prospect of additional U.S. stimulus bolstered the metal’s appeal and weighed on the dollar, with Washington’s lawmakers set to vote on larger coronavirus relief checks.

Spot gold rose 0.3% to $1,877.41 per ounce by 10:06 a.m. EST (1506 GMT). The metal climbed as much 1.3% on Monday after U.S. President Donald Trump’s approval of a $2.3 trillion stimulus package.U.S. gold futures rose 0.1% to $1,882.30.

Oil prices climbed on Tuesday on hopes the United States will expand pandemic aid payments, a move that could spur fuel demand and stimulate economic growth.

U.S. West Texas Intermediate (WTI) crude futures settled 38 cents, or 0.8%, higher at $48.00 a barrel, while Brent crude futures settled up 23 cents, or 0.5%, at $51.09 a barrel.


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